NEW DELHI: The virtually intractable parallel banking system, known as hawala, has made India a hub for financing terrorism, and it needs to be stopped in concert with Washington, an official US report has said.

Indian news agencies said on Saturday that the report wants New Delhi to work towards becoming a full-fledged member of Financial Action Task Force (FATF), an inter-governmental body for development of policies to combat money laundering and terrorist financing.

‘Given the number of terrorist attacks in India and the fact that in India hawala is directly linked to terrorist financing, India should prioritise cooperation with international initiatives that provide increased transparency in alternative remittance systems,’ news agencies said quoting the US State Department’s report in its section on India related to money laundering.

India’s Parliament passed the Prevention of Money Laundering (Amendment) Bill early this week, but the US report has suggested that India should make more legislative amendments to bring its anti money laundering and counter terrorism finance regime in conformity to FATF.

Released by Assistant US Secretary of State for International Narcotics and Law Enforcement Affairs, David T Johnson, it quoted estimates by the Reserve Bank of India as saying that remittances to India sent through legal, formal channels in 2007-2008 amounted to USD 42.6 billion.

Funds transferred through the billion-dollar hawala market are thought to be equal to between 30 to 40 per cent of the formal market.

‘In that case the hawala market could amount to between USD 13 billion to USD 17 billion,’ the report on International Narcotics Control Strategy, said.

The report lauded the steps taken by India post 9/11 with regard to money laundering and its possible use by terrorist network. However, it said, several key steps were still required to be taken by New Delhi.

Listing out the steps New Delhi still needs to take, the report said India should become a party to the UN Conventions against Transnational Organised Crime and Corruption.

‘India should devote more law enforcement and customs resources to curb abuses in the diamond trade. It should also consider the establishment of a Trade Transparency Unit (TTU) that promotes trade transparency; in India, trade is the back door to underground financial systems,’ the report said.

So much for India crying hoarse about Terrorism, I suggest they start putting their own house in order, and then go onto make the world a Better place.

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Pakfalcon sahab, the report mentions the use of hawala (hundis, parallel banking) to transfer funds which can possibly be used for financing terrorism. Hawala system being an underground system means there are no checks and balances in place. Nowhere does Naqvi sahabs article mention India is responsible for terrorism.

For India to set its house in order would require greater check on the underground economy, thought to be valued at between 30-110% of the GDP, which is by no means an easy task as govt of India has realised in its past and present endeavours.

India's strict foreign-exchange laws and transaction reporting requirements, combined with banking industry's due diligence policy, makes it difficult for criminals to use formal channels to launder money, the report said.However, large portions of illegal proceeds are often laundered through "hawala" or "hundi" networks or other informal money transfer systems.The report appreciated the steps taken by India post 9/11 with regard to money laundering and its possible use by terrorist network. However, several key steps are still required to be taken by New Delhi, it felt.

Yes, i know its not a very easy task to put check on the hawala flow, but India should look deep inside itself before calling on making Pakistan a pariah state.

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Making Pakistan a pariah state? AFAIK, India has been exerting full diplomatic pressure on Pakistan to stop supporting, funding, lionizing, sheltering terrorists, esp those striking India and bring them to preferably Indian justice.

To be honest with you most Indians are disappointed with the Indian govt.'s response to this whole fiasco, everyone wanted stricter steps and greater introspection so yes not only should India deeply cleanse itself but also whether by diplomacy or otherwise force others to deep cleanse themselves.

Equating an illegal ancient system of money transfer misused for criminal purposes with an overt/covert support for terrorist activities against another nation is a tad unjustified, don't you agree ?

Hawala is an illegal system and steps are being taken to counter it! You just cant barge in here with an article that doesnt support your personal claims or wishes and think we will believe your views. Post something that will make us believe it.

I think we shouldn't discount the article or the conjunctions posed. Having come from a city where such underhanded dealings are rife in everything from restaurants to real estate, and having relatives who are or were formerly involved in honor transactions with associates who were not exactly the cleanest of elements, I can affirm categorically (through indubitable information received through the grapevine) that the system does infact exist, and that the money does sometimes end up in the hands of anti-state elements. There is also a precedent in the form of the "Hawala scam" of the 90's involving the Jain brothers in which some leading politicians were implicated (and later acquitted), in addition to concerns about alleged payments being made to Hizb-ul-Mujahideen militants in Kashmir.

What is incontestable though is that hawala transactions occur primarily in countries that apply distortive receiving exchange rates- a prime example of which is Pakistan. Therefore, if anything, this article and the implications thereof apply more to Pakistan than it does to India.

To corroborate my statement above:

"In addition to commissions, hawala brokers often earn their profits through bypassing official exchange rates. Generally the funds enter the system in the source country's currency and leave the system in the recipient country's currency. As settlements often take place without any foreign exchange transactions, they can be made at other than official exchange rates.

Hawala is attractive to customers because it provides a fast and convenient transfer of funds, usually with a far lower commission than that charged by banks. Its advantages are most pronounced when the receiving country applies distortive exchange rate regulations (as has been the case for many typical receiving countries such as Pakistan or Egypt) or when the banking system in the receiving country is less complex (e.g. due to differences in legal environment in places such as Afghanistan, Yemen, Somalia).

Furthermore, the transfers are informal and not effectively regulated by governments, which is a major advantage to customers with tax, currency control, immigration, or other legal concerns."

"Countries such as Pakistan, which have traditionally benefited from hawala and other remittance systems, have introduced legislation demanding that hawalandars register their business with the government and provide documents relating to their transactions, to ensure transparency.[45]"...thus attempting to regulate and thereby legitimize the system.

"India, on the other hand, has adopted a different approach by banning the system outright"...thereby removing any chance of legitimacy. Is it the best alternative? Only time will tell.

This paper presents a description of the hawala (also referred to as hundi) alternative remittance system. Hawala is an ancient system originating in South Asia; today it is used around the world to conduct legitimate remittances. Like any other remittance system, hawala can, and does, play a role in money laundering. In addition to serving as a 'tutorial' on hawala transaction, this paper will also discuss the way in which hawala is used to facilitate money laundering.

What is hawala?

Hawala (1) is an alternative or parallel remittance system. It exists and operates outside of, or parallel to 'traditional' banking or financial channels. It was developed in India, before the introduction of western banking practices, and is currently a major remittance system used around the world. It is but one of several such systems; another well known example is the 'chop', 'chit' or 'flying money' system indigenous to China, and also, used around the world. These systems are often referred to as 'underground banking'; this term is not always correct, as they often operate in the open with complete legitimacy, and these services are often heavily and effectively advertised.

The components of hawala that distinguish it from other remittance systems are trust and the extensive use of connections such as family relationships or regional affiliations. Unlike traditional banking or even the 'chop' system, hawala makes minimal (often no) use of any sort of negotiable instrument. Transfers of money take place based on communications between members of a network of hawaladars, or hawala dealers (2).

How does hawala work?

Hawala works by transferring money without actually moving it. In fact 'money transfer without money movement' is a definition of hawala that was used, successfully, in a hawala money laundering case.

An effective way to understand hawala is by examining a single hawala transfer. In this scenario, which will be used throughout this paper, Abdul is a Pakistani living in New York and driving a taxi. He entered the country on a tourist visa, which has long since expired. From his job as a taxi driver, he has saved $5,000 that he wants to send to his brother, Mohammad, who is living in Karachi (3).

Even though Abdul is familiar with the hawala system, his first stop is a major bank. At the bank, he learns several things:

The bank would prefer that he open an account before doing business with them;

The bank will sell him Pakistani rupees (Rs) at the official rate (4) of 31 to the dollar; and

The bank will charge $25 to issue a bank draft.

This will allow Abdul to send Mohammad Rs 154,225. Delivery would be extra; an overnight courier service (surface mail is not always that reliable, especially if it contains something valuable) can cost as much as $40 to Pakistan and take as much as a week to arrive. Abdul believes he can get a better deal through hawala, and talks to Iqbal, a fellow taxi driver who is also a part-time hawaladar.

Iqbal offers Abdul the following terms:

A 5% 'commission' for handling the transaction;

35, instead of 31, rupees for a dollar; and

Delivery is included.

This arrangement will allow Abdul to send Mohammad Rs 166,250. As we will see, the delivery associated with a hawala transaction is faster and more reliable than in bank transactions. He is about to make arrangements to do business with Iqbal when he sees the following advertisement (5) in a local 'Indo-Pak' newspaper (such advertisments are very common):

Abdul calls the number, and speaks with Yasmeen. She offers him the following deal:

A fee of 1 rupee for each dollar transferred;

37 rupees for a dollar; and

Delivery is included.

Under these terms (6), Abdul can send Mohammad Rs 180,000. He decides to do business with Yasmeen.

The hawala transaction proceeds as follows:

Abdul gives the $5,000 to Yasmeen;

Yasmeen contacts Ghulam in Karachi, and gives him the details;

Ghulam arranges to have Rs 180,000 delivered to Mohammad.

This diagram summarizes the transaction:

​

Even though this is a simple example, it contains the elements of a hawala transaction. First, there is trust between Abdul and Yasmeen. Yasmeen did not give him a receipt, and her recordkeeping, such as it may be, is designed to keep track of how much money she owes Ghulam, instead of recording individual remittances she has made. There are several possible relationships she can have with Ghulam (these will be discussed later); in any case she trusts him to make the payment to Mohammad. This delivery almost always takes place within a day of the initial payment (a consideration here is time differences), arid the payment is almost always made in person. Finally, in some scenarios, he trusts her to repay him the equivalent of either $5,000 or Rs 180,000.

Connections are of equal importance. Yasmeen has to be connected to Ghulam in Karachi to arrange this payment. As her advertisement indicates, she also offers service to India, so she either knows, or has access to, someone who can arrange payment there. Hawala networks tend to be fairly loose, communication usually takes place by phone or fax (but email is becoming more and more common).
To complete this discussion, there are two related issues to be addressed. The first is the relationship between Yasmeen and Ghulam, and the second is how Ghulam 'recovers' the money that he paid to Mohammad on Abdul's behalf.

As was stated above, hawala works through connections. These connections allow for the establishment of a network for conducting the hawala transactions. In this transaction, Yasmeen and Ghulam are part of the same network. There are several possible ways in which this network could have been constructed.

The first possibility is that Yasmeen and Ghulam are business partners (or that they just do business together on a regular basis). For them, transferring money is not only another business in which they are engaged but a part of their normal business dealings with one another. Another possibility is that, for whatever reason, Ghulam owes Yasmeen money. Since many countries make it difficult to move money out of the country, Ghulam is repaying his debt to Yasmeen by paying her hawala customers; even though this is a very 'informal' relationship, it is quite typical for hawala. A third (and by no means the final) possibility is that Yasmeen has a 'rupee surplus' and Ghulam is assisting her in disposing of it.

In the last two cases, Ghulam does not need to recover any money; he is either repaying an existing debt to Yasmeen, or he is handling money that Yasmeen has entrusted to him, but is unable to move out of the country. In the first case, where Yasmeen and Ghulam are partners, a more formal means of balancing accounts is needed.

One very likely business partner scenario is an import/export business. Yasmeen might import CDs and cassettes of Indian and Pakistani music and 22 carat gold (7) jewelry from Ghulam, and export telecommunications devices to Ghulam. In the context of such a business, invoices can be manipulated to 'conceal' the movement of money.

If Yasmeen needs to pay Ghulam the Rs 180,000 that he has given to Mohammad, she can do it by 'under invoicing' a shipment to him. She could, for example, send him $20,000 worth of telecommunications devices, but only invoice him for $15,000. Ghulam pays Yasmeen $15,000 against this invoice. The 'extra' value of goods, in this case $5,000 (the equivalent of Rs 180,000) is the money that she owes him.

In order to move money the other way (in this case, from Pakistan to New York)',over invoicing' can be used. For this example, it is assumed that Ghulam owes Yasmeen $5,000. She could buy $10,000 of telecommunications devices, and send it to Ghulam with an invoice for $15,000. Ghulam would pay her $15,000; this covers the $10,000 for the telecommunications devices as well as the other $5,000.

Since many hawala transactions (legitimate and illegitimate) are conducted in the context of import/export businesses, the manipulation of invoices, as discussed above, is a very common means of settling accounts after the transactions have been made.

In brief, hawala 'works' - or competes effectively with other remittance mechanisms - because of its cost effectiveness. A secondary consideration is that hawala is often related or even integral to existing business dealings.

One reason for hawala's cost effectiveness is low overhead. A business like Yasmeen's 'Music Bazaar and Travel Services Agency' operates out of a rented storefront as opposed to a bank building (which has expensive vaults and alarm systems), and may even share space with another business (e.g. a sari or gold shop), further reducing rental expenses. Yasmeen's employees are paid less than bank officers, and they probably do not have insurance or access to a retirement plan. Some hawaladars operate with even less, using a table in a tea shop as an office and having little more than a cellular phone and notebook as overhead expenses.

The second reason is exchange rate speculation. In India, for example, the Foreign Exchange Regulation Act (FERA), 8(2) (8) states that '(e)xcept with the previous general or special percussion of the Reserve Bank, no person, whether an authorised dealer or a moneychanger or otherwise, shall enter into any transaction which provides for the conversion of Indian currency into foreign currency or foreign currency into Indian currency at rates of exchange other than the rates for time being authorised by the Reserve Bank'. Since hawala dealers do not, in many if not most cases comply with such regulations, their transactions may be illegal (a more detailed discussion of the legality of hawala follows).

Depending on one's perspective (and possibly jurisdiction), hawaladars are either engaging in foreign exchange speculation or black market currency dealing. In any case, they exploit naturally occurring fluctuations in the demand for different currencies. This enables them to turn a profit from hawala transactions (which, in addition to being remittances, almost always have a foreign exchange component), and they are also able to offer their customers rates that are better than those offered by banks (most banks will only transact at authorized rates of exchange).

The rates cited in this paper (35 Rs/$ for Iqbal, 37 Rs/$ for Yasmeen and the official rate of 31 Rs/$ as cited by the bank) reflect a difference of 12-19% over the official rate. These may actually be a little high. A U.S. hawaladar (9) involved in the laundering of drug proceeds as well as legitimate remittances told one of the authors of this paper that he could still make a profit on an exchange rate margin as small as 2%, making him much more competitive than a bank.

In addition, since many hawaladars are also involved in businesses where money transfers are necessary, providing remittance services fits well into these businesses' existing activities. Monies from remittances and business transfers are processed through the same bank accounts, and few, if any, additional operational costs are incurred by a business that offers hawala remittance services.

Finally, an important component of hawala is trust. Hawala dealers are almost always honest in their dealings with customers and fellow hawaladars. Breaches of trust are extremely rare. It is worth noting that one of the meanings attached to the word hawala is 'trust'!

Is hawala legal?

Since hawala is a remittance system, this question really addresses regulations governing remittance services (10) and the circumstances of the remittance. The assumption here, of course, is that these remittances are like Abdul's, and 'legitimate'; the illicit use of hawala in money laundering is discussed in the next section of this paper.

Even though hawala is illegal from a regulatory standpoint in some U.S. jurisdictions, hawaladars advertise their services widely in a variety of media (ethnic newspapers have been the traditional place to find them, now some are using the Internet). Enforcement of these regulations is difficult with respect to hawala. The advertisements are often printed in foreign languages, and wording like 'sweet rupee deals' does not necessarily suggest remittance services. Moreover, businesses like Yasmeen's do not conduct remittances as their primary activity.

In South Asia, the situation is more complicated. Many South Asian nations (such as India and Pakistan) have laws that prohibit speculation in the local currency, prohibit foreign exchange transactions at anything other than the official rate of exchange, and impose strict licensing requirements on money remitters and foreign exchange dealers. In addition, there are regulations governing inbound and outbound remittances.

A detailed discussion of these regulations is beyond the scope and intent of this paper. It is, however, possible to state 'hawala is illegal in India and Pakistan' with nearly complete accuracy.

The important point for our purposes is that the existence of these regulations is another reason hawala is still used. Many people in these countries have money that they would like to move to another country due to concerns about stability, to pay for education or medical treatment. Hawala provides a ready means of doing this, and its use as a facilitator of 'capital flight' on both large and small scales is very common. The existence of these laws also explains, in part, the prevalence of invoice manipulation as part of hawala schemes.

Another aspect of these regulations is the use of the United Arab Emirates, specifically Dubai, for hawala transactions. There are two main reasons for this. The first is the large population of expatriate workers from India and Pakistan; they use hawala to send money home. The second is Dubai's large gold market, which is the source of much of the gold sent (licitly and illicitly) to India and Pakistan. Dubai, unlike many other South Asian nations, allows essentially unregulated financial dealings. Because of this, many South Asian businessmen maintain offices in Dubai, and money is often wired there to circumvent regulations elsewhere. In addition, Dubai offers a neutral meeting place for Indian and Pakistani businessmen, as tension between these countries makes travel between them difficult if not impossible.

This paper should not, however, be considered a condemnation of the economic policies of India or Pakistan, both of which have taken concrete steps to combat money laundering. The efficiency and cost effectiveness of hawala make it an attractive means of remitting money under almost any regulatory regime.

Up to this point, no distinction has been made between hawala transactions where the source of the money is legitimate (e.g. Abdul's remittance to his brother) and where the source, and intent, of the transactions is illegitimate. Following Indian and Pakistani usage, the term 'white hawala' is used to refer to legitimate transactions, such as Abdul's. The term 'black hawala' refers to illegitimate transactions, specifically hawala money laundering (11).

This distinction is valuable for money laundering enforcement. Many 'white' hawala transactions are essentially remittances, and, while illegal under Indian and Pakistani law, are not illegal in other jurisdictions. `Black' hawala transactions, however, are almost always associated with some serious offense (e.g. narcotics trafficking, fraud), that is illegal in most jurisdictions.

Money laundering consists of three phases: placement, layering and integration. Since hawala is a remittance system, it can be used at any phase.

In placement, money derived from criminal activities is introduced into the financial system. In many money laundering schemes, the biggest 'problem' here is handling cash. Some jurisdictions, such as the United States, require reporting by financial institutions of cash transactions over a certain amount (in the U.S. it is US$ 10,000) (12), and attempting to circumvent such reporting requirements by making smaller transactions is an offense.

Hawala can provide an effective means of placement. In the example, Abdul gave Yasmeen US$ 5,000 in cash. Since she also operates a business (and also performs remittance services for others), she will make periodic bank deposits consisting of cash and checks. She will justify these deposits to bank officials as the proceeds of her legitimate business. Even though she might prefer it if reports were not filed, she will not object to this as it would arouse suspicion at the bank (and her business provides more than adequate justification). She may also use some of the cash received to meet business expenses, reducing her need to deposit that cash into her bank account.

In the layering stage, the money launderer manipulates the illicit funds to make them appear as though they were derived from a legitimate source. A component of many layering schemes has been seen to be the transfer of money from one account to another. Even though this is done as carefully as possible, when it is done through the 'traditional' banking system it presents two problems to the money launderer. First, there is the possibility that a transaction could be considered to be suspicious and reported as such. Related to this is the paper trail created by these transactions. If any portion of the laundering network is examined, the related paper trails could lead a diligent investigator directly to the source of the criminal proceeds and unravel the money laundering network.

Hawala transfers leave a sparse or confusing paper trail if any. Even when invoice manipulation is used, the mixture of legal goods and illegal money, confusion about `valid' prices and a possibly complex international shipping network create a trail much more complicated than a simple wire transfer.

Both of the authors of this paper have investigated hawala money laundering, and have found that even 'basic' hawala transfers can be difficult to trace and tie to the original, criminal source of money. There is no reason, however, why hawala transfers could not be 'layered' to make following the money even more difficult. This could be done by using hawala brokers in several countries, and by distributing the transfers over time.

In the final stage of money laundering, integration, the launderer invests in other assets, uses the funds to enjoy his ill-gotten gains or to continue to invest in additional illegal activities. The same characteristics of hawala that make it a potential tool for the layering of money also make it ideal for the integration of money. This is when money seems to become legitimate, and, as we have seen, hawala techniques are capable of transforming money into almost any form, offering many possibilities for establishing an appearance of legitimacy.

Given hawala's close ties to business activities, there is no reason why money cannot be 'reinvested' in a legitimate (or legitimate appearing) business. Yasmeen could very easily arrange for the transfer of money from the United States to Pakistan, and then back to the United States, apparently as part of an investment in a business there.

What are some indicators of hawala?

As has been shown in this paper, hawala is actually quite simple; much of the complexity associated with and ascribed to hawala money laundering comes from the nearly infinite number of variations that are encountered in hawala transactions.

This complexity of variation makes it nearly impossible to lay out a straightforward guide to recognizing hawala money laundering as part of a criminal undertaking. It is, however, possible to provide a few indicators that may be useful.

One of the most consistent and valid indicators of hawala activity in investigations conducted in the United States is seen in bank accounts. A 'hawala' bank account almost always shows significant deposit activity, usually in the forms of cash and checks, which are often from one or more ethnic communities (e.g. Afghan, Bangladeshi, Indian, Pakistani, Somali) associated with the hawaladar. These checks may be made out to the primary account holder, or some secondary entity (often outside the United States) somehow associated with the account. These checks may also have some sort of notation, consisting of a name (presumably of the person to whom the money is remitted to) or something supposedly indicating what was 'bought' with the money. In one case, many checks were seen with the word 'bangle' written on them; this was done apparently in order to make it appear as though the checks, which were almost all for even dollar amounts, had been written to purchase jewelry.

These accounts will also almost always show outgoing transfers (usually by wire) to a major financial center known to be involved in hawala. Three of the most common locations are Great Britain, Switzerland, and, as discussed previously, Dubai. Given the flexible and casual nature of the hawala business, hawala accounts will not always be seen to balance. The following diagram summarizes 'hawala account' behavior:

​

As has been discussed, certain businesses are also more likely than others to be involved in hawala. Once again, it is not possible to give an exhaustive list, but the following is a starting point:

Laws in India, Pakistan and other countries make it difficult to convert foreign currency (or foreign currency instruments, such as travelers' checks). Criminal activities in these countries may often involve foreign currency (especially dollars), which pose something of a problem. A 'solution' that has been seen to this problem is the shipment of these negotiable instruments from South Asia to the United States. Even though such shipments may violate both courier policies and U.S. law, the money launderers accept these risks rather than try to attempting to place these instruments into their local economies.

So much for India crying hoarse about Terrorism, I suggest they start putting their own house in order, and then go onto make the world a Better place.

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I will tell you this straight right now: when you make loaded accusations like this without doing your research, it is NOT appreciated on this forum...and you WILL make the mistake of making some real enemies pretty quick. This is not some fanboy pakistani forum and you would be truly deranged to think that you would even be tolerated here for long. India is "crying hoarse about terrorism" because it has been affected by "terrorism" sponsored from across the border for the last 62 years of its existence. As for "putting one's house in order", let me assure you that advice on that front is not needed from you because we have ALREADY embarked on that process: it is we who are scrutinizing and prosecuting groups purported to be involved in bomb blasts, we who are investigating alleged criminal-political nexuses and we who are taking a proactive approach to dealing with groups involved in terror- regardless of whether they are hindu, muslim, sikh or christian.

Let me also remind you that we aim to bring to bear political and diplomatic pressure on you because your "house" is so "out of order", so unruly and fetid from years of festering the same groups who are now taking you on to use as proxies against neighbouring states, that the filth is spilling over on to us. And as long as that rot that now infests your society continues to plague us, your business IS our business, your house OUR house and your agents (now turned enemy) OUR enemies as well. And India will crush those who try to poison and destroy her sons with "great vengeance and furious anger" as the Good Book of Ezekiel 25:17 says. And then shall you know the extents we will go to to protect our people when our vengeance is laid bare upon you.

This world IS a better place today because OUR conscript fathers sacrificed their blood for this nation, because WE are a thriving, functioning democracy despite all the problems we face, and because WE have the world's second largest muslim population that are a paragon of loyalty and peaceful coexistence for the rest of the Islamic world. It is better because WE as the world's second fastest - and now soon to be its fastest - growing economy contribute towards mitigating the debilitating effects of this economic recession. It is better because WE, despite having endured innumerable acts of constant cross-border terrorism, of interference in our internal affairs have always exercised prudence and caution in the face of defiance.

Pakfalconk, please find me any world wide newspaper that will support the ridiculous statements that the PAKISTANI DAWN . You find me a good one, then we will take you seriously. Like Rage said, this is NOT the forum for blind fan boyish behavior. Meanwhile, your beloved pakistan seems to generate a lot of hits when I typed in Pakistan terrorist;

Pakfalconk, please find me any world wide newspaper that will support the ridiculous statements that the PAKISTANI DAWN . You find me a good one, then we will take you seriously. Like Rage said, this is NOT the forum for blind fan boyish behavior. Meanwhile, your beloved pakistan seems to generate a lot of hits when I typed in Pakistan terrorist;

just a few obvious questions since Hawala is an closed system where USA cannot interfere would they have any ulterior reasons for this article? and how can they verify that hawala is used for funding? Hawala has been around probably even longer than the crumbling western banking system? Is hawala in anyways a threat to the decaying and insolvent western banking system? or is it perceived by the west as one because it is very solvent?(while they are insolvent)